This can be an effective tactic (meaning it could get you a raise), but it's not my preferred method. I prefer to focus on the situation itself without bringing in that sort of leverage because of the impact it can have on the way you're perceived at your company, by your manager, by your teammates, etc.
This strategy can work, but it's a little riskier than focusing on the value and working with your manager to align your salary with that value.
I wonder, do the managers see it that way? Engineers are doing their job and often buy into the worth of the company, the importance of their work etc. And even if they don't they think most of their peers do.
So when an engineer plays this card he tends to assume others will see it as ruthless.
But do management really think this? Do they really drink the kool aide and think less of you? Or do they just see this as part of the game, and only the underlings think like this.
Ex-manager (now VP) here. I've never thought poorly of someone raising the topic of their value to the company or their current salary. Doesn't mean I've always agreed with their assessment, but there's no hard feelings on my side.
By the time you go out and get another bona-fide offer that you're considering taking, I and our company have already lost the game if that's the first I hear about it. I'd much rather hear about it before you've invested that amount of time and energy into it and don't hold it against you regardless of the outcome. If we're talking about it every 3 weeks, it's a problem, of course.
I've also encouraged some very good employees to go interview and see what's out there. This is typically when a potential new role is fundamentally different from what I can offer. (Higher role at a smaller company perhaps, or a job in their home town, or a brand new startup with some past coworkers.) I've had all four outcomes (employee stays-no change, employee gets offer-we counter-they stay, employee gets offer-we counter-they leave, employee gets offer-we don't counter-they leave).
I also don't buy into the "never accept a counter-offer; they'll just be sharpening the knife to fire you later" line of thinking. If I didn't want you here, I wouldn't counter.
If you think of this whole process as a ruthless move in a game, I think you're thinking about wrong. You bring value to the table; the company brings value to the table; we freely exchange that value, making both of us better off.
> without bringing in that sort of leverage because of the impact it can have on the way you're perceived at your company, by your manager, by your teammates, etc.
Managers and HR don't give a damn about that. They do it all the time, all day along. They are professional negotiators, that's their jobs.
Your line of thinking can only manage to undermine yourself. Get it out of your head.
This strategy can work, but it's a little riskier than focusing on the value and working with your manager to align your salary with that value.